A FEW WEEKS AGO now, we addressed several construction issues that can arise. And today we will continue to outline a few more.
Hard Dollar Competitive Tenders
You may have heard of the term 'hard-dollar competitive tenders' and wondered what it means.
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As defined by the business dictionary, it is a "transparent procurement method in which bids from competing contractors, suppliers, or vendors are invited by openly advertising the scope, specifications, and terms and conditions of the proposed contract as well as the criteria by which the bids will be evaluated. Competitive bidding aims at obtaining goods and services at the lowest prices by stimulating competition."
Obtain the Right Advice
Competitiveness is important in this day and age. More and more businesses compete in overseas markets and your competitive edge could mean the difference between winning a job or going out of business.
The solution is to have a skilled team on board, a project team who knows what the difficulties and risks are and can advise you on all aspects of the project.
They can provide recommendations and assessments. You, as the project leader, make decisions based on experienced suggestions and advice from your team.
The false economy of not employing certain skills in order to save money often results in decisions being made that cost a lot to fix up, or result in delays and/or objectives not being met.
Building has its complexities and the risk of making decisions without the necessary knowledge is high. Lack of experience and lots of money at risk is a disaster waiting to happen -- so, make sure you gather an experienced team around you.
Site Selection and Older Buildings
The site of the building-to-be and the building you want is where the majority of costs can blow out. New ideas and difficult access, or new needs and and old building to be refurbished provide an example of what's possible and what's not.
Dreams and reality come crashing together and the fight to draw two opposing forces together is what becomes a drain on your resources.
A classic example would be new power requirements for a fitout going into an existing building. The older building doesn't necessarily lend itself to lots of cables, older very thick brickwork costs a lot to drill through.
New junction boxes can be difficult to fit into existing older style electrical services spaces, or worse, maybe the new power load you want isn't easily serviced by the existing external infrastructure.
Somewhere in between these competing forces lies your answer -- and getting to it can be slow, frustrating and a process that needs flexibility.
Another example is a shop front or facade on the outside boundary or property line.
Will council let you change the facade? (Some historical buildings have very inflexible design rules.) Will your desired back office area fit with the old facade? How you integrate the old with the new is often a job that has to be sorted out as construction progresses -- because as old materials are uncovered old problems (like crumbling brickwork) are also uncovered.
Integration is an important process best undertaken by a construction professional because he or she can ensure all risky areas of the build are identified and budgeted for, even prior to the actual problems being uncovered. And the budget can be adjusted accordingly, prior to sign off.
The Solution is ... Early Builder Involvement
Many building issues result from the traditional win/lose approach to client and contractor relationships. But change this to a win/win approach and the dynamics of the project also change -- providing better outcomes as a bonus.
How to get there?
An excellent way to reduce the risk of variations on a project is early involvement of the head contractor or builder. Introduce them to the site and ask for their constructive criticism about the nature of the project and what future costs may be involved.
Getting the builder involved early can give you an idea of 'real' building costs.
Once you have an opinion of the risks, you can then set a more realistic budget. In addition, a proper feasibility study can give another tool when negotiating the price of the site (if you don't already own it).
Bottom Line: Identifying your risks early on is the key to making almost every project work. You'll know whether to walk away or stay, how much you're likely to be up for and whether it still fits with your overall objectives.
